Michael D'Arcy (Fine Gael) | Oireachtas source

I congratulate the Leas-Chathaoirleach, as I did not do so when we met in the Convention Centre on Tuesday. I wish him well in his term. I also take this opportunity to congratulate the Cathaoirleach and wish him well in his term. While I am congratulating people, I would say to the Minister of State, Deputy English, that his appointment to the Department of Business, Enterprise and Innovation is welcome. I know him to be a practical person, which always helps in that area in particular.

I wish to start by quickly analysing the scale of the pandemic's impact. At the peak of employment about four or five months ago, we had 2.2 million people at work, both part-time and full-time. At the peak of the payments from the Department of Employment Affairs and Social Protection, we had almost 1.2 million people on a social protection payment of some nature. That meant we had 1 million remaining in work full-time and being paid, of whom about 300,000 were public sector employees. That puts into perspective the scale of the number of people who are working in private enterprise and keeping the system going. It is about 700,000 people, and there are almost 5 million people in Ireland. That cannot continue because the employment triangle will tip over. As such, everything revolves around getting people back to work and that is what this small piece of legislation is about. It is about providing funds so that businesses have the opportunity to draw down moneys.

There is a caveat here that I am really concerned about.Many businesses do not want to go into further debt by borrowing money or taking out more loans because they potentially have too much debt already. I will come back to that point later but it is something we cannot ignore.

I welcome the legislation. I recall the legislation being passed in 2012 and the reason for that was the banks did not have the moneys to lend at that point, which is different from the situation today. The banks have funds to lend and their capital ratios are quite strong. We are now entering a period of uncertainty for people's businesses and employment. The banks could have a significant problem with mortgage payments if jobs are lost as that will eat into their capital ratios. There is even more uncertainty regarding businesses because if they close, that will also eat into the banks' capital ratios and their ability to lend. That is why this legislation is so important. The moneys in question are small but they are only one tool in the kit that will be required. We are told that the July stimulus is two weeks away but that is only going to feed into the stimulus for budget 2021, which will take us up to 18 months from now. The crucial aspect of where we are is that if we fail on jobs, everything else will fail. Our tax take, the banks' ability to lend and people's ability to put cash back into the economy, whether through coffee shops, the hospitality sector or any other sector, will fail as well. The Minister of State touched on the importance of the SME, microfinance and FDI sectors. They are all intermingled and there is no escaping the fact that we have to be successful in all of them because if one falls, it will create a domino effect through the other areas, which will not be pretty.

As regards the legislation, I welcome the increase of €70 million to go into the pot. I also welcome the ability to borrow beyond for Science Foundation Ireland and moving to the SBCI because again that will mean more ability to lend. Senator Higgins mentioned flexibility and made a point about additional transition criteria. We should remove those because it means there are boxes to be ticked Some businesses may not be able to tick a box and that creates a difficulty for the people processing the applications. It is essential that we remove the criteria. Senator Murphy referred to removing red tape. We have to do that. We want to be able to get this money out quickly and easily in order that businesses can move on.

The Minister of State mentioned the two aspects of the rates rebate scheme. Last year's restart grant of up to €10,000 was very welcome. However, some businesses have a large staff but may have paid low rates, so that does not help. Someone might have had seven to ten staff but only paid €2,000 or €3,000 in rates. It is not good for those staff. I believe that the extension of the three-month rebate has to occur. We should provide certainty, and the extension of the rates rebate should continue to the end of the year to then be decided based on budget 2021, which is not too far away.

There are two economies in Ireland: Dublin and the rest of the country. We need to have a different view for the rest of the country because it is not in the same category as the economic engine of a single urban area of more than 1 million people in the greater Dublin area. We need to look at that. It is something we need to be sure about in the July stimulus.The temporary wage subsidy scheme is how we are putting money into businesses but we need to remove "temporary" and it needs to become a wage subsidy scheme. I do not know for how long or how much money will be involved as this will depend on the virus. It will depend on the extent to which the pandemic comes back and has further impact on the entire country or, potentially, some areas. We see in other jurisdictions that localised lockdowns have been required. We need to make the decision, and if there are localised lockdowns throughout the country we need to have a pot of money for those businesses in particular because this will determine the success or failure of employment. Without employment the dominoes will fall. As we saw when the dominoes fell in 2008, which flowed into the end of 2010 and the legislation in 2012, sometimes they cannot be pulled back.